Modest equity gains generally seen following the US FOMC Minutes
|Asia Market Update: Modest equity gains generally seen following the US FOMC minutes; USD declines; BOK rate decision inline.
General trend
- Possible China RRR cut in focus [China Cabinet said: Will make RRR cuts at appropriate time].
- HK Mainland Properties Index moves sharply higher; Shanghai Property index declines [China PBOC and CBIRC bank regulator issue guidelines to support property market; urges stable financing].
- Japan markets rise following holiday.
- Thursday is a US holiday.
- China’s Commerce Ministry (MOFCOM) sometimes holds weekly news conferences on Thurs.
Headlines/economic data
Australia/New Zealand
- ASX 200 opened flat.
- (NZ) New Zealand sells NZ$400M v NZ$400M indicated in 2025, 2032 and 2037 bonds.
- (AU) S&P: Australia Nonconforming Home Loan Arrears Rose In Sept.
Japan
- Nikkei 225 opened +0.9%.
- (JP) Bank of Japan (BOJ) offers to buy 5-10 year JGBs at fixed rate of 25bps; Opens window to buy unlimited amount of 10-year JGBs at 0.25% [as expected].
- (JP) JAPAN Nov preliminary PMI manufacturing: 49.4 V 50.7 PRIOR (1st contraction in 22 months and lowest since Nov 2020).
- (JP) Japan PM Kishida: Not considering year end cabinet reshuffle; Certain election expense receipts were missing, to ensure it does not happen in the future.
- (JP) Japan PM Kishida urged China's Xi to ease Covid restrictions in China - Japanese press.
Korea
- Kospi opened +0.8%.
- (KR) Bank of Korea (BOK) raises 7-day repo rate by 25BPS TO 3.25%; As expected.
China/Hong Kong
- Hang Seng opened +0.9%; Shanghai Composite opened +0.2%.
- (CN) China Ministry of Finance (MOF) sells 3-year bonds: Avg yield 2.28% v 2.2295% prior.
- (HK) Hong Kong Monetary Authority (HMKA): No need or intention to change HK$ Peg to USD.
- (CN) China PBOC Open Market Operation (OMO): Sells CNY8.0B in 7-day reverse repos v CNY2.0B prior; Net drain CNY124B v net CNY69B prior.
- (CN) China PBOC sets Yuan reference rate: 7.1201 v 7.1281 prior.
- (CN) China People's Daily: Must be quick in stopping coronavirus spread.
Other
- (SL) Sri Lanka Central Bank (CBSL) leaves Key Rates unchanged (as expected).
North America
- AAPL Working with Foxconn on staff concerns; Have team on the ground at Zhengzhou facility.
- (CA) Bank of Canada (BoC) Rogers: There does not appear to be much contagion between crypto trading market and conventional financial markets; We are watching carefully.
-(US) Weekly EIA Natural Gas inventories: - 80 BCF VS. -86 BCF TO -88 BCF indicated range.
-(US) FOMC Nov minutes: participants concurred there were very few signs of inflation pressures abating; substantial majority judged a slowing in pace of hikes would likely soon be appropriate.
Europe
-(DE) German Bundesbank Monthly Report: Inflation could stay in double digits into 2023.
-(EU) ECB's Stournaras (Greece): Now sees more reasonable rate hikes - podcast.
-(UK) BOE’s Pill (chief economist): BoE must keep financial stability and monetary policy distinct.
-(EU) ECB's Centeno (Portugal): We are near rate levels compatible with price stability in mid term.
-(EU) Reportedly EU talks on Russia oil price cap have stalled over price level; Negotiations continue - press.
Levels as of 00:20 ET
- Nikkei 225, +1.1%, ASX 200 +0.1% , Hang Seng +0.4%; Shanghai Composite -0.3% ; Kospi +0.9%.
- Equity S&P500 Futures: +0.2%; Nasdaq100 +0.2%, Dax +0.1%; FTSE100 +0.1%.
- EUR 1.0448-1.0392 ; JPY 139.65-138.61 ; AUD 0.6768-0.6723 ;NZD 0.6270-0.6220.
- Gold +0.5% at $1,755/oz; Crude Oil -0.2% at $77.75/brl; Copper +0.2% at $3.6505/lb.
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